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Businesses including the finance industry must adapt to changes in the digital sphere or risk going extinct, the Reserve Bank of Australia has warned.
Chief information officer Sarv Girn said in a speech this week that digital disruption has transformed the corporate world and firms would need to adjust to survive.
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Digital disruption occurs when business routines are interrupted by changes in digital technology, he said.
Mr Girn said giants such as General Motors, Kodak and Nokia were “struggling to stay relevant” because they had failed to capitalise on digital technology.
“Bookstores, the music industry and newspapers – all of which were the giants of their time – now find themselves trying to avoid extinction,” said Mr Girn.
He added that all businesses including banks, law firms and government organisations must learn to adapt to new technologies.
Apple, IBM and Domino’s Pizza are businesses that have successfully capitalised on digital disruption, according to Mr Girn.
He said that the Reserve Bank had also jumped on board by adopting a server environment that is 80 per cent virtualised.
Mr Girn explained that other businesses using banking and payment systems could adopt similar systems in the future, though he warned that not all firms should deal with disruption the same way.
“If you do want to harness the growth potential, then observing and learning from the patterns of the leaders is vital,” he said.
“Building digital disruption plans into the corporate conversation and embedding it into the goals and cultural DNA of your firm is fundamental.”
[Related: RBA study find big spenders overvalue their homes]
